Rockrose Energy Share Discussion Threads

[bobby1904] 07/3/2020 16:38

I've been reading so much amateur rubbish posted on RRE last few days that it's depressing. Some facts (rather than the usual fictional rubbish spouted) for people to dwell on:- RRE has no debt. It has c.$315m+ FREE cash (ie after deducting $55m restricted cash). It's average OPEX is c.$22 per barrel. Even after adding in CAPEX + ABEX (ie Abandonment costs) it still only goes to c.$44 per barrel. It's 2020 CAPEX programme + budgeted Abandonment expenditure would still leave it over £100m (sterling) even assuming the oil price never recovers and the return on this CAPEX is a whole year of progress on their 7 well programme (West Brae, Arran, etc) all of which add to their resources and work towards lifting 2021 production materially from the current level of 21,000 bblpd. However, the reality is that a mixture of the hedging they have in place and the likely recovery of the oil price at some point in the next 12 months, this picture can improve materially. They paid a dividend on 60p last autumn and due a further expected 25p after full year results. Andrew Austin (Exec Chairman) holds 27% of the shares so is extremely well aligned with Shareholders. People who have simply sold due to the oil price drop have massively misunderstood how undervalued the company was before the corona issue arose. At an share price of £18 it was already only trading at a price equivalent to its free cash balance (ignoring the rest of the business completely). I've seen comparisons made with Tullow and that just demonstrates the moronic and amateurish level of commentary here! Tullow is a totally different beast. It operates in completely different geographic/political/risk environments and is loaded to the hilt with a mountain of debt and its senior team just kicked out. For those with actual cash (as opposed to poxy margin traders) and with some patience to take a medium term view there aren't many better stocks than this in the O&G space at this sort of mkt cap. This share price is ludicrous (30% discount to its free cash!!) and even if it dips lower before recovering, there is a big upside to be made without the need to be concerned about cashflow/funding, etc.

[gooner1886] 06/3/2020 16:43

Could be a rough few months but should bounce back hard bad times always create wealth

[costax1654x] 06/3/2020 16:42

Depends on oil price!Look at Tlw from 225 to 23

[costax1654x] 06/3/2020 15:36

Oil demand down 2.7 million bpd.Opec want to cut 1.5mCan we see the problem here.

[fozzie] 06/3/2020 15:18

'This share has fallen 900p in the last 6 weeks incredible' you can say that again. I keep buying as it falls, this madness cannot last.

[costax1654x] 06/3/2020 14:16

No worries they entitled to an opinion as well

[dunderheed] 06/3/2020 13:58

The point is they need more than 1.5mm drop imho.

[bountyhunter] 06/3/2020 13:21

yes in the balance right now but maybe not in a week or so's time

[momentofclarity] 06/3/2020 13:20

Not sure OPEC will be able to get their act together and get this 1.5mlbpd cut in place, thats what crude is telling us at least...its in Russia's interests not to cut production so that a few of these heavily leveraged shale companies go to the wall....we shall see I guess

[retsius] 06/3/2020 13:17

Ffs I thought they money in the bank

[bountyhunter] 06/3/2020 13:15

I'm still holding for the same reason as dragon35

[bountyhunter] 06/3/2020 13:14

OPEC will cut further I suspect to underpin the oil price at least to some extent until this crisis is over. Markets are forward looking and are pricing in a pandemic.

[blueball] 06/3/2020 13:00

This share has fallen 900p in the last 6 weeks incredible.

[nigelpm] 06/3/2020 13:00

Nothing surprising here if you understand the business.

A fall in oil price is bad news here because the decommissioning liabilities stay where they are but the cash flow reduces.

All oil companies have this problem - the problem for RRE is that the decom liabilities are huge in comparison with NAV.

Of course the oil price tank won't persist forever.

[daburd] 06/3/2020 11:26

I think that's a bit unfair on Costaxx

My chart also says next support is 1092 having broken through 1405. But I agree that charts are a bit meaningless at the moment

hxxps://www.marketscreener.com/ROCKROSE-ENERGY-PLC-25805241/charts/

Not going to sell mind.

[dragon35] 06/3/2020 09:46

Yes you could be right. I hold RRE and a bag of cash right now. Only holding RRE due to fundamentals and the possibility of them putting the cash to work and not wanting to miss it if they suspend.

[jon123] 06/3/2020 09:05

not so sure it is a buyers market yet think there is more downside than up for at least the next month or so

[jon123] 06/3/2020 08:56

lol someone can't read charts lol